European Central Counterparty Limited (EuroCCP) today announced it is launching clearing and settlement services for Depositary Receipts.
The new services, scheduled to go live this Autumn, subject to regulatory review and approval, will provide clearing and settlement for approximately 50 of the most heavily-traded listed Depositary Receipts.
Depositary Receipts comprise a significant segment of the international securities markets business. They provide traders with the ability to invest directly in high-growth economies in an easy and cost-effective way.
This new service offering will enable market participants to capture in their Depositary Receipts transactions the benefits of operational efficiencies, cost savings and protection from counterparty risk that EuroCCP already provides for some 5,000 equities issues.
Turquoise will be the first multilateral trading facility (MTF) to offer trading in Depositary Receipts cleared through EuroCCP. Initially, settlement of these instruments will be in Euroclear Bank.
Adrian Farnham, Chief Operating Officer at Turquoise, commented: "Turquoise is dedicated to providing innovative and efficient methods of trading that deliver demonstrable value to investors. Depositary Receipts are increasingly popular ways to access fast-growing economies and we are pleased to offer members the opportunity to execute their transactions on Turquoise. We look forward to providing the Depositary Receipt market with the same efficiency and differentiated value that Turquoise brings to European equities, and EuroCCP's fully risk-managed clearing and settlement arrangements are integral to this."
Andrew Simpson, head of EuroCCP Product Management in London, said: "By collaborating closely with our users, EuroCCP has been able to develop a market solution that is significantly better than those currently available, particularly in the area of buyer protection for corporate actions.
"EuroCCP's strategy has been to continue expanding service offerings to clients not only by covering additional trading venues but also by diversifying the types of instruments and transactions it clears," Simpson continued. "We're always looking for opportunities to partner with clients and other service providers to create solutions that add value to the industry."